By Julian Hattem - 06/03/14 11:39 AM EDT
Federal officials have filed charges against the head of two websites that raised money in the form of the virtual currency bitcoin.
Erik Voorhees allegedly sold shares for his sites SatoshiDICE and FeedZeBirds for bitcoins, but did not register with the Securities and Exchange Commission (SEC) as required by law. That led to hundreds of thousands of dollars through the unregistered offerings, the financial regulator charged on Tuesday.
The SEC claimed that Voorhees looked for people to invest in the bitcoin sites at the Bitcoin Forum, a website dedicated to the virtual money, as well as on Facebook.
In May, 2012, he allegedly raised 2,600 bitcoins for FeedZeBirds, which promises to give Twitter users bitcoins for retweeting sponsored messages. Additionally, from August, 2012, to February, 2013, he raised about $722,000 worth of bitcoins for SatoshiDICE, which gives bitcoins out to users for winning games.
Voorhees agreed to settle the charges by paring a $35,000 penalty in addition to the more than $15,000 in profits he earned.